Top 5 Mistakes in My Rent-to-HMO Journey with Athena Dobson

Welcome back to another episode of Girls in Property! In today’s solo episode, your host, Athena Dobson, dives into her top 5 mistakes from her Rent-to-HMO business.  Athena’s sharing the raw and real aspects of her experience,  offering a candid look at what went wrong and how you can avoid similar pitfalls.  Expect a mix of laughter, insights, and real talk as Athena helps you navigate the Rent-to-HMO landscape with her firsthand experience. Tune in for a blend of education and honest conversation.

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Transcript

0:02

Good morning, everyone. Happy Monday and welcome to today's episode of the Girls in Property podcast. So once again, you have me for the next hour or maybe less talking to you with my solo episode once again. For some reason, these solo episodes are seemingly doing really well. The downloads are great. Loads of people are tuning in. The feedback's fantastic. So back by popular demand, I thought I would do another solo episode. and kind of interweave them into, course, where I get some fantastic guests on as well. So yeah, it will be me. Whatever you're doing today, I hope you're having a wonderful day. If it's taking the kids to school, if it's driving yourself to work, then let me keep you company for the next 45 minutes to an hour and we can have a bit of fun. So today's episode, I thought, right, what could I do as a solo episode that would really, really help people wanting to learn more about the different Sort of strategies that I specialize in if you like which are predominantly service accommodation HMOs and vital X that's sort of my remit at the moment if you like and I try and teach as much as I can about what it is I actually do and then get the experts to come on and talk about the things that I'm not so familiar with So what seemingly did quite well last time for the podcast was this idea about top five mistakes lessons and that kind of vibe and I always find that that's what does that does sort of the best when it comes to podcasts or even just social media, because I think a lot of people like to learn a lot from others mistakes as it were. So I think that if I can help as many people as I can learn from what potentially I didn't do right, to then help people go forward, that could be really useful. So first of all, let's start off with today's celebration, which is what I always do. And actually in keeping in theme with today's podcast, which is always all going to be about my top five mistakes or lessons, if you like, from my first HMO business, then I'm going to keep it with that for my celebration regarding HMOs as well. So what I'm celebrating at the moment is I'm actually stepping away from the concept of rent to rent. And if some of you aren't familiar with the concept of rent to rent, it's effectively where you control another person's asset. So in its simplest form on a rent to rent HMO, let's just say, you would simply pay the landlord a rental fee like you would if you were gonna live in the property. But rather than you living in the property, what you would do is you would then get, let's say it's a five bedroom HMO, you would get five different individuals living in that HMO. on five different ASTs, which is Assured Short -Hold Tenancies, and you would then take the profit between the rental that you receive from the individual five tenants and what you pay to the landlord, of course, minus your expenses and costs. And that's how a rent -to -rent works. So it's a way of getting into the property industry and acquiring and controlling an asset without having to invest huge amounts of money that you may or may not have. and I've been doing that for the last two years now, my rent to rent business for both service combination and HMOs. And actually what I'm celebrating at the moment is the fact that I am now in a position where I no longer need to go down that route as much because if you like, I've kind of. My stripes and I have acquired the funds that I've needed to from it in order to now progress and actually start buying assets, which is super, super, super exciting. So what I'm celebrating at the moment is the, is the fact that I'm actually going to be purchasing my first ever HMO conversion, which I'm very, very excited about. So this is predominantly going to be where you would take, in theory at the moment, because I haven't acquired it yet. So in theory, let's say a three bed terrace house and convert it into a six bed all on suite HMO. It could have studios, it could just be on suites, but effectively you would... you would convert it and then you would refinance it onto a commercial valuation. So that's really exciting. And I love this notion of building my assets and building up my portfolio now for myself, as opposed to the rent -to -rents where I was just controlling the assets. I actually want to own the assets myself now, which is really exciting. I, of course, I've already got my buy -to -let portfolio, which runs really well. I absolutely love it. And that's building that up, but I'd really like to go and build some HMOs now. So... Yeah, I'm celebrating this evolution of myself in terms of now looking to the next chapter of, okay, what's next for Athena? And it's funny, I speak about myself in third person, but there we are. And it's now this notion of, okay, what is next? And what is next for me is definitely purchasing. So yes, very, very exciting. I would of course document the whole journey, bring you all along the way, but I'm... I'm really proud that I'm now in a position to do it. I managed to raise some investor funds in order to do it as well, which is really exciting. So that was another thing I was able to do is to raise the finance to go and do this because of the way that I've been sort of showing up and showing people what I've been doing, which is so important. Tell everybody what you do and you never know who is watching and sort of slow burners, which is really great. And yeah. So watch the journey, watch this progression into assets over rent to rent. But yeah, really happy. And today I'm going to talk to you all about the mistakes I also made along the way with the rent to rent HMO business. So let's begin. So as I said, predominantly what I'm gonna be speaking to you about today, because I don't actually own any HMOs myself at this moment in time when I made this podcast, I'm gonna talk to you about the mistakes that I made in my rent to rent HMO business, which is slightly different to when you actually own the HMO, and you'll see from the mistakes why there is a differentiation between them. And as always, I'm gonna keep on track. I've got my five mistakes written down. Believe me, there is more than five, but I thought, well, what do I think would help people the most? And also have a bit of fun, tell some stories along the way. And then of course, we will always finish with a property disaster. So yes, and of course, please do send me in before I begin any celebrations that you have at the moment. I love it when people do that. They're like, you know, I wanted to tell you my celebration this week, and I love it. So please keep sending them to me. He keeps me company and I love it and I will always try and get back to you. You know I will. Okay, let's begin. top five mistakes lessons from my first HMO business. number one I've written. Don't rush taking on your first HMO. And I've written underneath that as a side note, trust your gut and trust the numbers. Okay, what do I mean by this? So. I'm sure everybody is guilty when they first start out in the property industry, especially with the rent to rent situation is you rush to take on your first property. And there are multiple reasons that you do this. So not long if any of these resonate with you because they certainly were the reasons that I might have rushed my first one. Number one, start your business and you know you want to go into the property industry. And when you get into rent to rent majority of the time, but not all the time, majority of the time, you don't have a lot of funds to start with to actually go and acquire and purchase your first property. So what ends up happening is that you end up seeing a lot of costs going out of your business when you first start your rent to rent business. So for example, accountancy fees. Sending out letters which can cost about three to five hundred quid sometimes depending on how many you're sending You know getting the bank account set up getting the logos getting the right business cards made all of these costs start racking up and what you do is you start looking at your bank account and you start going my god all these costs are going out and You think I better get some income in quick And so what ends up happening is you start rushing to take on your first property thinking rush, rush, rush, rush, rush, then you think, right now I'm gonna get some revenue in. But what you therefore do is you almost sometimes go against your gut and you sometimes go against the numbers as a result of that. The other thing that might happen is let's face it, within the rent to rent sector, anyone who's gone through it before will know that it's quite a difficult thing to try and explain to people, especially to landlords and agents. And I'll come on to that. And because it's difficult to speak to them, when somebody finally agrees to give you one, you almost think to yourself, my God, this person has given me their property. I finally can do a rent to rent after having 50 rejections. I better take this one on because I don't know who else is going to say yes to me. Who's nodding? That's not the right way. That's not the right way to approach it. If the numbers don't work, then don't do it. If there's something in your gut that goes, know what, this looks like an absolute shithole, I don't want to actually take this on. I think there's going to be loads of issues. I think the landlord's going to be a pain in the bum. Don't take it on. Don't rush. There will be others. I assure you there will be others. There is always others. And people often ask me the question, go, Athena, when you say do your numbers and things like that, what traditionally tends to be? a good figure to work with. Many people will answer this differently. For me personally, this is just a personal thought of mine. I never took on a property for a HMO that profited me, that's profit, not turnover, profited me less than 500 pounds. So anything less than 500 pounds, I didn't even take on. Usually for me, they ranged from about, I'd say like 650 up to, we had one that was up to about think seven. 780, 780 a month. So they were okay actually, but I would never have gone for anything less than 500. So if you've got one there that you're like, I've done my numbers and I can get 350 pounds, don't take it on. Also, I haven't actually written this one down, but just while we're on this subject, the other thing that sometimes you can do, and I have been guilty of this before and quickly learned it's not the right way to be, is when you're trying to negotiate with the landlord to try and take on your first property. They'll have a figure in mind. So let's say just for argument's sake they want three thousand pounds rent and you do your numbers and you're like the absolute most we can offer him is 2 ,500 or her I should say him or her we cannot offer more than 2 ,500 Don't then start playing with the numbers for what you can charge for rooms by sort of going well if we increase from 550 to say 620 and we increase from you know, 470 to 520, suddenly the numbers work and it's like, don't do that. Don't do that. You can tweak it slightly, but don't do those extremes because if for example, you for whatever reason cannot get the higher rentals you were hoping for, you will then put yourself in a really, really difficult situation. The figure that you should be playing with the most is the rental income that you are going to give to the landlord. because that is fixed and that would be certain. You cannot be certain what you are going to get for the rental properties from the tenants, you just can't. And so yes, you can tweak it by say a tenner or a fiver, best case scenario, worst case scenario, no problem, but don't rely on definitely getting the higher income. If it's in a high demand area, for example, if there's a lull at the moment, be really, really careful and do your market research, I would say. to try and get that right balance. So my first advice is don't rush taking on your first HMO. If the deal doesn't work, don't take it on. If your gut tells you not to take it on, don't take it on. If the numbers, you know, just really, really, really think about it and think to yourself, I'm not gonna rush this one because don't forget, the reason I say this to you is because yes, you can put a break clause in over a year. Of course, there is always an option to do that. But theoretically, The purpose of doing a rent to rent is to take it on for a minimum of three years. You know, we usually took ours on for about five years. So a minimum of three years. And with that, therefore, you don't want to be locked into something for three years that you just don't want to be in. Therefore, if you've got a bad feeling about the landlord and you think, can't work with this person, don't do it. Just wait, would be my advice. And the next one will come along. Otherwise you'll be stuck and you'll go, why do we take this one on? And then there won't be enough funds to then take on the next one because you suddenly got yourself in a hole in the first one. best advice I can give you, don't rush taking on your first HMO. I know it's difficult when you first start out. I know there are a lot of costs. I know there's a lot of expenses. I know you want to get revenue in as quickly as possible. Trust me, don't make it worse by taking on the wrong property. Number two. work with the agent, not against them. So number two, work with the agent, not against them. So this is really funny actually, and I talk to lots of different people about agents. And I of course know a lot of agents, quite a lot of agents now, my friends. And I find it hilarious because I don't know about you, but I feel like when people talk about agents and investors actually, agents and investors, they speak about them like they're aliens. And they speak about them like they have this... golden nugget, golden key to do everything that they need and it's just not true. It really, really isn't. And people sometimes put agents and investors on this pedestal and I'm like, they're just like you and me. They're just human beings. And sometimes you might find someone that you say, you know, did you call the agents? They'll say, no, I didn't call the agents today. And I say, why didn't you call the agents? And they say, I, you know, I was too scared or. I was scared of being rejected or I was scared about not knowing what to say. And I would say to them, just have a conversation with them. Just be normal. Just literally have a conversation, be friendly with them and they'll be friendly back. And my advice actually is, and this is a top tip from me to you, you will get a much, much better response, I find, my opinion, by actually going in to speak to the agent face to face and doing it over the phone. I think that a lot of people... And I appreciate that a lot of people don't have time because they're still in full -time employment whilst they're trying to get into the property industry. And I respect that. But what I would recommend is maybe trying to take a day off or half a day to go and actually speak to the agents directly. Because I found that I got such a different reaction when I did that. And then when I then went to make the calls, they'd already seen my face. They knew I was real. They knew about my personality. And they can see a lot of your body language. They can see a lot of your confidence. And so it makes for a much better... Report if you like and you can have a coffee together and chat and it's just a lot nicer So I've been found that my response rate of having a yes as opposed to a no was better if I went in so that's a top tip but what I would say is work work with the agent not against them, so What I mean by that is you'll you'll a lot of people including myself actually Were sending out quite a lot of letters so direct to vendor letters or direct to landlord letters worked really really well for me So we would send out letters and do like a marketing campaign against that. And we usually got a really good response from the landlords in regards to that. If you like, kind of bypass the agents and when direct and that works really well. And that works well for a couple of reasons. Number one is you don't have to explain yourself twice once the agent wants to the landlord. And two, then you cut, you technically cut out the agent and cut out their fee. So therefore you can make the deal stack or deal. Yeah, deal stack a lot better with the landlord directly because they're not then having to pay the agent fees on top of that. So it makes the communication process a lot smoother. So there are lots of benefits going direct to vendor and a lot, lot of people will talk about that and why that is so good because of that. However, what I will say is, is if you can try and get the agent on side, because once the agent knows you, once the agent likes you and once the agent understands what it is that you're doing, they will realize that you actually are a fantastic member of their power team. And therefore they will bring you more and more properties. So rather than you just taking on one property, suddenly the agent's bringing you one every week or every two weeks saying, what about this one? What about this one? Because they know that effectively what you're offering is that you become their tenant in a way. That's how I always explain it. You become their tenant. So all they need to do from you is take the rent. You literally pay them the rent and that's it because you take care of all the maintenance up to a certain degree in terms of cosmetic So you take on the maintenance. They're not the ones and getting the calls from the tenants getting all the headaches That's you because they're your tenants and then you are the tenant of the agent So as soon as you start explaining that to the agent suddenly they're like, so I get to get all of this money All of this management fee for doing really no work. You're like, that's exactly right And sometimes it can even be a case where you get them so onside and you start talking about, well, you can't usually charge, for example, admin fees anymore. It's against the law to not charge admin fees to tenants. But because you're a company, you can start talking about the fact that, look, if you give me this property, potentially you could charge me a consultation fee. And then from there, what we could do is maybe do a deal where if you give me one, it's this price, two, it's this price, three, it's this price, et cetera. So there are different conversations that you can have, which tend to happen outside of the... outside of the shop, I'm honest with you, just because of, you know, what they can and can't do. But I tend to get on really well with agents and tend to get them onside, know, befriend them, you know, find out what their favorite coffee is. Some people take them donuts and people take them chocolates. But what I would say is all that you have to do is be at the forefront of their mind so that when a property comes up, they instantly think of you and they call you straight away. That's where you need to get to. Sometimes people will say to me things such as, I visited the agent last month. And I'm like, okay, you need to go again and again and again and again. And it almost needs to be that they get so tired of seeing your face. They're like, just take it. Just take the property so that you don't come back. And that's what you need to do. And you almost need to have a bit of fun with them. So what I would say is, is work with the agent and not against them because it could be that they actually end up bringing you multiple, multiple properties. So for example, when I was doing my rent, rent and HMO business, we actually did acquire that relationship with an agent who kept bringing us multiple properties. And actually, I'll tell you another trick with this also is to always find out from the agent when you're actually at the viewing, whether or not they are doing a tenant find only, or if they're managing the property, because that could really determine the way that they go. So what I mean by that is, is if they're just doing tenant find only, That means their sole job has been paid a fixed flat fee, regardless of who goes in there, regardless of what the rent cost is, they're being paid, let's just say 600 quid for argument's sake for now, to say, the landlord, say, find me a tenant, put them in there, do the referencing checks, off you go. The landlord is actually then gonna solely manage the property traditionally, as opposed to if the agent is actually finding the tenant, putting them in there, and then managing it. So that could also be a conversation that they're having. Cause if an agent, example, like that I know quite well just as tenant find, I knew that they therefore it worked really well from them because I kept being in the background going, yep, I'll take that one. I'll take that one. Not that one. Yes, I'll take that one. And then they were just getting their flat fees every time and it was really easy for them. So it's a case of really understanding the agent, having a conversation with them and always being a problem solver for both landlords and agents. you know, what is it that they need? Traditionally, not always, traditionally in areas such as Bournemouth, for example, which is where I operate, it's a lot of student accommodation, lots and lots of student accommodation. And so traditionally, there are lots of issues that come up for estate agents regarding maintenance, and they deal with hundreds and hundreds of HMOs. And so in fact, what you're saying to them is, Let me take that pressure off of you. Let me take that property off of you, that property off of you. So you haven't got to deal with that and you still get the rents paid, but I deal with the maintenance. So agents can be a fantastic, you can be a fantastic member of an agent's power team and an agent can be a fantastic member of your power team. It's really understanding and explaining to the agent and getting them to understand how you can help each other and create a win -win. If of course the agent then doesn't understand, isn't willing to cooperate, isn't willing to have a conversation, fine, then a direct vendor approach also works really well to bypass the agent. So you have lots of options, but what I would say is try at all costs to get agents on side and go in and speak to them like a human being as opposed to just making a call. You will find you get a better reaction. Cool. Then number three, I've written here, Always ask pre -validating questions before agreeing to a viewing. So, always ask pre -validating questions before agreeing to a viewing. Okay, I have many, many stories about when I conducted viewings. I could write a book, many, many. And what happens is, okay, here's what happens. So, picture this. Picture that you've just taken on your first HMO and that you now have one month rent free period that you have negotiated with the landlord so that you can set up the HMO ready to get your professionals in and that you now market the HMO on say spare room to get tenants in. And now you need to conduct viewings to start getting tenants in so that you start acquiring cash in, sort of revenue in through rental so that you can start profiting from the rental and the HMO. So what you therefore do is you start getting this influx of people interested in your properties. And in a way, when you first start out, you think, yes, yes, yes, yes. Yes, I could do this viewing. Yes, I could do this viewing. Yes, I could do this viewing. And 99 % of the time, and that's a bit high, let's go for 95 % of the time. A lot of the people who are trying to view your property to stay in have a full -time job. And therefore that full -time job finishes traditionally about five o 'clock, sometimes six o 'clock. So they want to come and view it about seven, seven 30. So it's very late. It's very late. And so therefore what you do at the beginning is you think to yourself, yes, I could do that. I could definitely do that. And you start almost trying to be like a people pleaser and getting people in and getting people to come to the viewings. Now, What you need to think is, and I had to learn this quite quickly, not everybody thinks or behaves like you do. Not everyone thinks or behaves like you do. And I had to learn this lesson. And what do I mean by that? What I mean by that is you could have someone that you're texting, texting, messaging, emailing, whatever form of communication you want to do. Who says to you, I'll see you there at seven o 'clock. And you reconfirm with them one hour beforehand, say, hi, I'm now driving to the property. See you at seven, is that still okay for you? And they'll say, yep, see you at seven, I'm on my way as well. You think, great. You arrive at seven o 'clock at said property after driving half an hour and you wait about five minutes. Then you wait about 10 minutes, wait about 15 minutes. After 15 minutes, you give them a call and you say, hey, I'm at the property, where are you? And they say, sorry, something came up. I'm no longer able to come to the property. And so you're now about what? 7 .30 at night. You've just done a full day's work. You're at this property. Nobody's coming to view it anymore. And as a result of that, you're now like, right, okay, fine. And then you have to drive home again. And that happened multiple times. It wasn't once, it wasn't twice. It happened multiple, multiple times. And it will happen to the majority of the people. I'm sure there are people listening, nodding their heads or people thinking, yep, stuffy happened to me. Also, the other thing that I would say is sometimes what can happen is, is that the viewing takes place, but because they haven't actually answered the pre -validating questions, simple, when I say pre -validating questions, I mean, how long do they want the tenancy for? Are they aware of what the cost of it is? Do they have a right to rent in the UK? Do they have an annual income of X amount that's deemed to pass credibility, for example? And sometimes these pre -validating questions were not asked. Pets as well, pets is a big one. So let's take an easy one to explain. So let's say that in a HMO, you can't have any pets due to allergies, due to various people living in the same property together. So I would go to the HMO to do the viewing, the person turned up, all was going really well, happy days, lovely. And then at the end of the HMO viewing, they say, by the way, I've got a cat. Can my cat come as well? And you go, no, sorry, cats aren't, cats can't come into this HMO because of X reasons. And they say, I can't take the property on them. And so you've gone, you've conducted the viewing, you've taken time to go to the viewing, you've taken time to show this person around the viewing. And then right at the end, they go, sorry, I have a cat. Then you go, okay. And then they can no longer take the room. Now, if you'd asked pre -validating questions such as, you have any pets? Then they would not have actually have agreed to come to the viewing in the first place and you wouldn't have wasted your time. So it's really, really important that you do ask these questions. For example, another one could be as simple as understanding their situation regarding, you know, right to rent. Is it, for example, that they have a visa and a visa to work that's really important to understand? Is it the fact that they They don't have the visa or they do have issues in which case you wouldn't be able to take them on or you need to take them on but in a different way. You need to know this information before they come. Another one which is really important is when you have your set prices for your rooms and you ask pre -validating questions such as, are you aware that this room rents for 675 per calendar month? Is this within your budget? Yes or no? They have to reply yes or no. If they reply yes, they are aware that the room costs 675. So when they come to the viewing, they are aware that that's what the room costs. They're not then going to say to you, my budget's 550. And you're like, well, you told me that you had a remit of 675. You've answered yes to that. Whereas if you didn't have that as pre -validating questions, you know, it'd be a different story. So it's important that you have that because I've had it before where somebody said, we'll do a viewing, all agreed. And then we send the pre -validating, questions before we actually physically go to the viewing. And I asked this question and they said, no, sorry, my budget is And I said, sorry, we can't conduct the viewing then because the room is 675. And that was it. And so neither of us wasted our time. It wasn't within their budget. They weren't able to move in and therefore neither of us went. So it's really, really important to do this. Also, it shows their commitment also to the process. So for example, I always, always now and forevermore will say to people, do not go to a viewing unless a person has answered the pre -validating questions. Just don't go because it shows a level of commitment that they took the time to answer like seven, eight questions. And if they didn't take the time to answer seven, eight questions, they aren't serious about taking on the room. So that's really, really important to do and a top tip for me to you to not be like me, don't waste your time. It will still happen to you. So embrace it. I was speaking to somebody the other day and I, property is a people business, right? But my God, you, what you do is you don't ever manage the property. You manage people. People are bizarre and like they do not behave the way that you, you would behave or the way that you think that people should behave. And so people will stand you up. People won't, won't arrive. It will happen, but you can at least. mitigate as much risk as possible by getting these questions validated. Funny story actually, just while I'm on this topic of viewings is, God, this was about, this was at the beginning. So this was about like a year and a half ago, because I would never have done it now, but a year and a half ago, I was trying to fill one of the rooms. I remember, I don't even know why I did this, but here we are. remember I was at an Indian with Steve and my mum. my partner Steve and Mum and I remember I was at this Indian restaurant and this person messaged me saying, hi I'm in the area can I view the room? And I said no sorry you know can't view it tonight. This is about like seven o 'clock at night. I said view it tomorrow and he says I'm only in the area for one day can I view it now? I'm ready to go, I'm ready to pay, I can confirm this evening and I remember thinking do you know what the void's about to come up on this room? it'd be good if I could get this, I could get this tenanted. So I stupidly left the meal with my family, back in the day when I didn't understand work-life balance and went to the property to be with, to go and meet this guy. And immediately, immediately when I turned up, I had this, I had this really bad feeling. I just had this really bad feeling when I saw him and I just thought, I don't know about this. But true to form, I ignored those feelings. And, which never do by the way. And so we went into the property and I remember thinking to myself, I remembered literally the thoughts going through my head going, it's about what? Eight to seven 30, eight o 'clock at night. I'm in this empty HMO with this guy who had been in the army much bigger than me, like much, much bigger than me. And anything could happen right now. Nobody would know I'm wrong. They knew I was there, but nobody else really knew I was there. And I remember it really, really well. It was a really silly thing to do to the point where I actually, I remember when we went up the stairs, I said to him, you go first. I don't want you walking behind me, you go first. And he actually said to me, I kid you not, he said to me when we were in this HMO, he said to me, what, so that you can kill me from behind? And I thought, right, that's it, I'm about to die. I thought this is the most stupidest thing I've done in a really, really long time. So, of course, when he said that to me, I said to him, I don't think this is right for either of us and I'm going to ask you to leave. I said, I don't think this is right. And he got a bit funny about it and I thought, God, he's going to kill me even more now. But no, he did leave. He did leave and he said, he says that that's fine. And I said, I just don't sense the vibe is going to work here. Something's off. and true to form when we went outside, there was, there was like a camera basically that the landlord had installed from ages ago at this particular HMO that doesn't even operate. It's literally not even on this camera. And the guy said, when we were stood outside, he said, where does that camera link to? And I said to him, I actually don't know. said, I've got no idea where it links. So it's not even on, doesn't even function as it were. And he said to me, I want, I want the footage from that camera. And I said, why? Why do you want the footage from the camera? And he says, because of my particular job, which may or may not be true, by the way, this could be, this could completely be true. He said, because of my job, I'm actually off grid. So I don't have an identification. I don't have, I don't have anything like that because of the type of work that I do. And therefore there can't be any footage of me. And I thought, my God, Jesus Christ. I knew, I knew that something was a bit odd. So, So I went and I messaged the landlord and the landlord said it doesn't even work. So I just got a copy of that and showed the person. But God, that was an interesting experience. So that's where, again, don't become so desperate to try and fill the rooms that you then almost go and do something that isn't within your nature, such as rushing to get to a viewing, last minute at night, to try and fill a void. It's like, it's not worth it. It really, really isn't. Just do everything. in the correct way, do the pre -validating questions, get everything done in a professional way. And don't ever put yourself in dangerous situations. Like what I did was dangerous, was stupid, really stupid. Don't do that, really don't do that. Try and either don't do them as late at night or try and get somebody else to go with you, that type of thing. that was a, luckily I was absolutely fine, nothing happened, but it's always that what if. So now I'm always taking a lot more caution in those situations. yeah, I detoured a little bit there to tell you a funny story, but these are the stories that I have from my days. So learn from them and sit there and enjoy your meal, enjoy your curry, would be my advice to you now. Cool, so that was always ask pre -validating questions. Don't waste your time going to viewings without them. Your time is precious. Always know that. Know your worth, know that your time is precious. And if they want to view, then they can view. The other thing I would say just a number three before I move on is what I would also do if you're not doing it already is do block viewings. So let's say for example, you're like the viewings only happen between because of timing, the viewings only happen between five to seven. So two hours and each viewing should only take about 20 minutes, I'd say 20 minutes. So if you can do block viewings within that time, then that's it. And also people have said to me before this question, so I'll answer it, people say to me, but Athena, what if they can't get to the viewing between five and seven on those particular dates? You say, I'm really sorry, but that's what that's all that I've got available. And then if the room is still not filled by that time, you then give them extended dates. If they want the room and your room is a good quality of a room that they really want, because the standards, which it should be, by the way, you should have good standards of rooms. they will fight heaven and earth to get to that viewing to take that room, believe me. So stand firm, say these are my block bookings, these are my dates, and then at least you can block your diary professionally and say I'm only available between five to seven Wednesday this week and Thursday this week, any other day I'm not available. And stand firm with that would be my advice and a lesson. Okay, number four. Number four, I've written here, agree any fixtures and repairs or add -ons with the landlord before signing the contract. So again, agree any fixtures and repairs or add -ons with the landlord before signing the contract. And I've written in brackets here, also be clear on responsibilities. So let's take this one at a time because it's two sections. So what do I mean by this? Let me give you an example of what happened to us when we... we took on our first property of this particular landlord. And when I say us, I'm referring to my business partner, Sophie Foote. So what happened was we took on this property and we were basically viewing it and everything looked fine. It had just been refurbed and it was great. But what was really interesting was because of the sizes of the rooms on this particular property, you could actually have some rooms that were double occupancy. and they had the HMO license to have couples in the room as opposed to singles. And so when we were looking at the cupboards, the cupboard spaces, we were thinking to ourselves, well, there's enough for say single rooms, but there aren't enough as a couple. And we assume that the landlord knew that and we assume that the landlord would do something about it. The other thing we assumed actually, which is why we thought the landlord would do something about it. is because my business partner, Sophie, operated in Southampton at the time and I operated in Bournemouth. And then she then came and joined me to run the HMO business in Bournemouth. And so she thought that the compliance would be the same in Bournemouth that it was in Southampton. Because to be compliant in Southampton, the rule is every single tenant needs to have a separated individual cupboard space allocated to them. That's the compliant rule in Southampton. That rule does not apply in Bournemouth. We don't have that rule. And so we naturally believe that the landlord would have to put extra cupboard space in to be compliant. And then when we re -read the document, it wasn't in there. And that was a really foolish mistake of us. First of all, assuming that the landlord would do the right thing, silly thing to do in terms of, you know, assuming that a landlord would do that. And number two, assuming that the compliance was the same in Southampton as it is in Bournemouth. So what therefore happened was, was when these tenants moved in, which should have been a, so it's a six bed HMO, but it was licensed for up to nine instead of six, so nine tenants. When the nine moved in, there was not enough cupboard space for everyone. There just wasn't. And so therefore we said to the landlord, need to put extra cupboard space in, you need to put an extra fridge in. And the landlord just refused. The landlord was like, no, I'm not going to do it. They've got. one fridge, they've got cupboard space, they can share. And I said, this isn't enough space for them to live. And they said, well, and he said to us, well, you should have negotiated that before you signed the contracts, because I would have put them in before you signed. Whereas now that you've signed the contracts, I'm not going to put them in. And don't get me wrong, you get lots of different types of landlords. You get some landlords who are fantastic to work with, care about their homes, care about the people in their homes and are a joy to work with. And then sometimes you get landlords who are very, very difficult to work with. And it's quite saddening actually, when you see that, because then you understand why there's this vicious circle about negative tenants, negative landlords, and you kind of see it firsthand happening. So the result of that, what actually ended up happening was that me and Sophie out of the business's pocket had to build extra cupboards and had to put in an extra fridge. because it was the right thing to do and the tenants needed it to live. And so that came out of our own pocket, which in my opinion, it should have, it should have come out of the landlord's pocket. If you disagree with that, let me know, message me, but that's the way that I saw it. And as he said, he said, if you'd let us know before signing the contracts, it'd have been a different story. So what we therefore learned from that was anything that needed a repair, painting, snags, anything like that. We were really, really detailed in our proposal to say, this is what is required at the property before we sign the contracts. We need an extra fridge, we need extra cupboard space, et cetera. And actually, to be fair, that made things much easier going forward because we were completely on the same page with the landlords and we also knew what was expected from both sides. So my advice would be... always, always don't rush signing the contracts before you look at the property and you really understand and make sure that you have everything you need for the tenants before signing anything. So that would definitely be a really good one. And then definitely put that into the proposal when you go to make a proposal for the landlord. I also wrote on the same point, be clear on responsibilities. So what I mean by this is 99 % of the time, How it works when you do a rent to rent contract deal is that you as the company are traditionally responsible for things such as cosmetic work. So let's say that, you know, a lick of paint, if there's like a leaky tap, know, door knob breaks, that type of thing, cosmetic stuff that needs adjusting and fixing within the property. You wouldn't contact the landlord for that. That would be part of your expenses and that you would just fix. However, if there's an issue, for example, like the boiler breaks, or there is a roofing issue or a structural issue, that is the landlord's responsibility. So for example, we've been in a position before where there's been a huge issue with the shower in the bathroom, and the shower actually needs replacing completely because it's so dated, it's so old. And the landlord has refused to do it. And we've said it is part of the property, you need to fix this. and they refuse to do it and therefore we ended up having again to fork out from our business the money to fix it because it's the right thing to do. However, from a revenue and profit point of view, that's then detrimental to the business. So it's really clear that before you take it on, you speak to the landlord and you say to them, these are our responsibilities, these are your responsibilities and to give examples such as these where this happens. so that you are completely both on the same page and you have it in writing as well, so that you don't then have any issues when you go through the property after a year to two years, and then these start coming out of the woodwork and the landlord refuses to pay and then all your profits get wiped. Really, really important. I always, always say to people, and even to the landlords themselves, I always say, remember that this is their property. It's not your property, it's their property. You are simply managing it for them. They would never expect a tenant to replace a whole shower system in a tenanted property. It's ludicrous. They would have to take care of that. Boiler issues, they would have to take care of that. So always remember you are simply renting the property from them for your business and keep that in the back of your mind in terms of whose responsibility should be what. That's a really, really important one. And that will protect you massively going forward in your HMO business. And then number five, number five, last but not least, I've written here, get off WhatsApp, have a HMO software system in place. Okay, what do I mean by this? Okay, WhatsApp is the devil when it comes to managing properties. It really is. Because WhatsApp should be used for friends, family, And instead what ends up happening is, is if you have a HMO WhatsApp for your tenants, it then ingrains into your personal life and your phone just goes ping, ping, ping. Also, it is a little, if you like, unprofessional and then the tenants start to not view things in a professional way. So for example, we never ever did this, thank God, but I know some people that did, were setting up things such as HMO house WhatsApp groups. And then they were in those groups. And so suddenly they were getting, you know, ping saying, Hey, can you sort this and Hey, this person hasn't taken out the rubbish and Hey, this person hasn't cleaned up. And suddenly you end up becoming this like mother to the, father to these tenants. And you're like, well, this is, this is not what I signed up for at all. And they, because it's a WhatsApp, they don't understand that they, that they need to speak to you in a professional manner or to deal with issues in a professional manner. So. My advice is do not ever go on WhatsApp with your tenants. Don't do it. It's a really, really downhill road from there. Instead, what I would recommend is having a HMO software system in place. So for example, we've used Coho, Coho software, C -O -H -O is fantastic, run by Van. And also Arthur is another one that I know a lot of people use. So Coho and Arthur are sort of the main HMO software systems and they're fantastic. They're absolutely brilliant. you can do everything on there. From a, from just for this purpose of this conversation in terms of what they can offer, it would be things such as let's say they wanted to report a maintenance issue. There is literally a button they can press on their app that says report a maintenance issue. And then they can see the flow of the work from there. So you can click accepted. You can then click report to maintenance team. You can then click contacting. You know what date they're going to then come and arrive. So they don't even need to contact you. They can see the flow of where it is in the process as opposed to having this back and forth WhatsApp in an unprofessional manner taking over your life. And then you can have the software on the on it completely separate to, for example, your mobile phone. You can have it so that it only comes up on your laptop so that you keep your phone for personal use as opposed to business use. So it's a really, really interesting way. to get off of WhatsApp and do it in a professional manner. And also then they then don't treat it like an unprofessional way. So when they message you, all the messages are really professional. They can also direct message each other within that software system as well. You can then be added to certain messages, removed. They can add videos, they can add photos, report things. They do even your rent collection on there. Like it's absolutely fantastic. It's really, really great. so certainly worth, worth doing and not then getting bogged down by this pinging of WhatsApp messages from every single tenant that you have in multiple different HMOs. Because for example, you could have up to something like 40 rooms at once. And can you imagine your WhatsApp just pinging constantly with maintenance issues, people issues, people wanting to vacate their property and wanting to hand in their notice, it's relentless. It really, really is. So what you don't want to have is you don't want to have it constantly on WhatsApp pinging you. So be professional with that and definitely do not be part of any house WhatsApp groups. It's like the worst thing you can do. And then I've just written little extras here, cause I thought, what else is really important to know? So these are the more boring bits, but important just to make a quick note of them. I've written here, ensure the landlord has is like compliant, of course. So that means in terms of fire regulations, as well as the HMI licenses, so make sure that they're compliant, really important and that you get all of that onboarding information before you take on the property. And then also when the HMI license is due to expire as well, really important because then you need to know when it needs to be reviewed and renewed as well and make sure that everything is there. Also, the other thing I would say on that one actually, just while I'm on this conversation, is it might be that say five years ago when they originally applied for the license, they were compliant. However, now because things have worn down, things have changed, maybe the fire strips aren't as good as they used to be, maybe the fire extinguisher isn't where it's supposed to be. It could be that when they come back, they're then not compliant in the way that they should be. And then you end up having the conversation about well, who pays to get it compliant? No, that's not how it works. What's really important to do is to say, right, you're you've currently got your HMO license your HMO license is due to expire November 2025. This is what we deem the property to be like in its condition at the moment therefore it will pass licensing or it won't pass licensing. However to be clear when the license comes for renewal in 2025 one you will pay for the license itself however we're happy to manage that for you as part of our agreement no problem and two in order to bring it up to the standards to be compliant such as via safety strips such as combi microwaves, God knows what these days they ask for, those would be your responsibility and therefore we agree that's part of our contract. So then when it comes to that stage, there was absolutely no confusion as to who pays for what. So again, really important. It's almost like this notion of prepare, you know, prepare so that you don't fail that saying as it were, you know, plan to prepare. No, fail to plan, plan to fail. You know the one I mean. That one, I'm sure you're gonna message me now telling me what the actual thing is. Always plan is what I'm trying to say. Make sure that you do that. So. Just to go over those one more time, the first one was don't rush taking on your first HMO. Believe me, they will come along and then they end up coming along like buses. Always trust your gut and trust the numbers. So numbers wise, you want to look for about 500 pounds per calendar month minimum in my opinion. Number two, work with the agent and not against them. So get them on side, they're not aliens, be friends with them and they'll be your best friend and a fantastic member of your power team. They really are. Number three, always ask pre -validating questions before agreeing to a viewing. So don't waste your time. Always pre -validate them before they come to a viewing. Number four, agree any fixtures and repairs or add -ons with the landlord before signing the contract and also be clear on responsibilities. Really, really important on that one. And then number five, get off WhatsApp. Do not get into any WhatsApp groups or WhatsApping your tenants. It's a really bad slope. And I said, have a... HMO software system in place. So those are my top five tips from taking on your first HMO. To be honest with you, whether that is purchase or rent to rent really. And yeah, those would be my top five ones. I've actually got another five. So I might continue to do these episodes if you really enjoy them. But I would say if you can sort of definitely, you know, make sure that you get those in a fantastic place. then that would really, really steer you well going forward. So yes, I hope you enjoyed any questions you've got about HMOs, let me know. As I said, I'm embarking now on my first HMO conversion and purchasing my first HMO. So that's really exciting. However, rent to rent HMOs, fire away, ask me any questions that you've got, more than happy to help. And then what I'm gonna do is I'm then gonna start a series of these. So the next one will be most likely top five mistakes for my first rent to rent service accommodation. and then top five mistakes from taking on my first bi -tel act. So I'll keep doing these solo episodes because I know you enjoy them. And anything else you want me to talk about, just let me know. This podcast is for you. So let me know what it is that you want. Let me know the listeners you want to listen to. And then I can sort of manage it as best I can in that regard. Yeah. And then for property disaster. So... I've got my own, if you like, I put an inverted brackets, property disaster, but still like a, not so much a disaster. Cause I don't really have so many disasters these days, which is quite nice, but a mishap, a mishap and a reality, let's say a property reality, I should call this, was yesterday. Yesterday was Sunday. Today is Monday, the 19th of August when I recorded this. So yesterday on Sunday, I was sitting at home Sunday evening. It's about. like quarter to eight at night, I'd sit down, have some dinner, relax, watch a movie before I start my week again. And a guest checks into one of the apartments for the service combination. And I think, okay. So I check my messages and they say, hi, we cannot close one of the windows in the bedroom because it's really stiff and one of us has a broken arm and the other person couldn't do it on their own. And so I was thinking, goodness, have I really got to go out and fix this? So I tried to delegate as best as I could, tried to find anybody in the area who could do it because I live about half an hour away in a place called Verwood. And so it takes me about half an hour to drive into the apartments. And I thought, do I really want to go on a Sunday evening? So I got them to some photos and to be fair, it was wide open. And I thought, no, for health and safety, cannot, I cannot leave them with this on a Sunday evening. So I went over to the accommodation. It's now about half eight at night on a Sunday. And to be fair, this window was really heavy, like really heavy. I understand how she couldn't do it on her own. Even the two of us, it was really, really heavy. So I got it all fixed, which was great. It actually needs replacing. So I sort of did a short term solution to it, but I did fix it for them. They were very grateful. They had a couple of other questions that they wanted to ask and things. I answered their questions. And by the time I got home, it was just after nine. So it was like quarter past nine on a Sunday. So it wasn't dreadful, but at the same time, what you got to think is when you're doing a rent to rent service accommodation business, predominantly it's usually rent to rent. You don't have a management team managing the property because there just wouldn't be any profit in it. If you had a management team from them as I've ever done. I've never been able to make it work with management. So I manage all of my own service combination properties. So I do all of the messages. I do all of the responses. I do all the cleaning bits. I do everything for it, including going out on a Sunday evening to also fix certain issues as well. And so I suppose there comes a moment where you sit there on a Sunday evening and you reflect and you think to yourself like, why am I doing this? What is it that I want? What is it that I'm now? at a stage in my life where do I want to keep doing this? Is this what I want? Is it even worth the money? Is it even worth it for my sanity on a Sunday evening where I'm supposed to be having a day off because I work all week? And it's really interesting when you have those moments and you think, God, you know, but what I will say is this, it's not passive. It's really not. It's not. And so if you want complete passive income, where you don't have to be called out and deal with sort of issues, even tenants, know, tenants lock themselves out all the time. Fire alarms go off, all of those, and you will have to be called out. Just think about that and think about why you're doing it, what's the purpose. And if like me, when you first started out, it was purely for cashflow, because you needed to acquire cash because you just left your full -time job and you needed to get money in, then believe me, you'll, you'll, you know, do it in a heartbeat. You know, I did it and literally did it in seconds. used to you know, think, yes, I'll go and no problem. But now you're at the stage where sort of you weren't your stripes and you've got the cash and you think to yourself, do I need to do this anymore? And so what I would say is, is think about why you're doing it. And then when the time comes, when you've been doing it for a while, think to yourself, do I now evolve? Do I now need to evolve into the next chapter of my property life, my property stages? And what I've learned recently is that it's okay to almost go, backwards to go forwards I would say and so this notion of do I still want the rent to rent businesses is that what I still want to do or do I now want to start building assets do I now want to start thinking about going a bit slower but building up that instead and so that's a really interesting concept so yeah learning and growing always but my property mishap if you like is that on Sunday evening last night I was literally fixing a window and then came home and ate my dinner really late, about nine o 'clock at night. So yeah, it's not glamorous. It's real. We work hard. We earn our stripes and we all should sit here. Very proud of ourselves for everybody who does the same things. I see you all. I see your hustle and, yeah, I'm proud. I'm proud of you all for, doing it. And I'm, right there with you. I'm there all the way with you. So. Yeah, so that was my solo episode. I hope everybody enjoyed it. I always shock myself the fact I'm able to speak for an hour completely on my own. But that was my top five mistakes from my first sort of HMO business. I'll be doing another solo episode about my service accommodation business and another about my vitalettes as well. But for now, what I'll leave you with is to say, be kind to yourself, trust the journey, enjoy the journey. Make sure you have a good work -life balance. Always be safe. Don't rush anything. yeah, just enjoy it. Just enjoy the journey and remember why. Why you're doing something I think is so important. Definitely. So I've got some incredible guests coming on the podcast soon, which I'm really excited to share with you. Lots of different topics, but if there's any topics you particularly want someone to come and talk about. then please do DM me and let me know. Just message Girls in Property on Instagram or Facebook. That would be the best way. And then just a reminder, of course, I've got the Girls in Property Community Group. So if you'd like to come and join the community, then please DM me the word community. We're now 65 members, so a nice round 65. And it's fab. I absolutely love it. I built it on the Circle platform, so it's really professional in the way that it looks. And there's lots of different departments that you can kind of talk about. So... you if you want to have like share your wins as a section, announcements, if you want to ask the community a question, there's a section and then you've got all the property bit. So if you want to only talk about HMOs, rent to rent, service combination, commercial conversion, buyer, refurbished rent refinance. So it's all in compartments, you like folders so that everyone can have different conversations at the same time, but not lose the rest of the conversation, which I think is so important. And then we've got Alice Dartnell actually coming to talk for the community group on Tuesday. I think it's Tuesday the 6th of September. Let me just check my calendar. No, I lied. Tuesday the 3rd of September. Alice Dartnell, who's going to be talking about energy and time management. And that's only for community members. So if you want to come and join us, then please do so before Tuesday the 3rd of September. And then of course, I'm going to be doing much more promotion of this going forward. I was just waiting for the summer holidays to... to sort of fizzle out. But of course we've got the Christmas gala as well on Saturday the 7th of December. So make sure that you grab your ticket, just DM me the word gala and I'll send you all the bits. But I'm gonna be doing loads of promo stuff on it going forward now. So come and join us. It's literally just gonna be a night with about 80 to 100 women at Penley Manor over in Tring in Hartfordshire. vibes wise, think ball gowns like black tie. photo booths, fun, dancing, dance floor, casino, maybe even like a vodka fountain I might try and get. So it's just good fun, good fun, good vibes, because that's where the connections really, really do happen there. So that will be going out. More promotion on that will be going out soon, but tickets are already nearly, we're sort of about halfway through, I'd say about half full at the moment, which isn't bad for this time of year. So yeah, if you want to come grab a ticket. And yeah, just carry on listening to the podcast and look after yourselves, look after each other. And then the other, last thing I'd say is that I also now have launched a, a property mindset accelerator course, completely free of charge. for anybody who really feels that they need to develop the right mindset to become the best property investor they can be. I built this course for you. So if you want to get your hands on that completely free of charge, It's literally videos of me speaking to you. I even do like little workbooks and worksheets in there and exercises like limiting beliefs, buster exercise. Then just DM me the word mindset and I will get that sent to you as soon as possible. Sign up free of charge and enjoy. But yeah, if anybody's got any questions about anything I spoke to them about today, just DM me. I hope you're all well. Keep listening to the podcast. If you want to find my personal page on Instagram, I am Athena Dobson, underscore official. And of course on Instagram, we are girls in property and on Facebook as well. But I'm sending loads of love to you all. Thank you so much for tuning in. Thank you for listening. You know where I am if you need me. And I look forward seeing you with a guest next week. Take care guys. All the best. Enjoy. Bye.